Russia: Riot act
Also: the Balkans, France, Germany, the US, the Middle East, Ethiopia, and Somalia.
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RUSSIA. Riot act
Putin faces rare protests in the heartlands.
Hundreds of protesters clashed with police in Bashkortostan, Wednesday, after a local anti-war activist was sentenced to four years in a penal colony. The demonstrations, amid -20c weather, were attended by up to an estimated 10,000.
INTELLIGENCE. Large protests are increasingly rare in Putin’s Russia. And this close to elections on 15 March, they will have consequences for local authorities. Bashkortostan is a bellwether in what passes for Russia’s democracy. In the 2018 presidential election, it was, alongside Volgograd, the federal subject that closest reflected Putin's overall vote share of 77.53%. Since last year’s Wagner mutiny, Moscow is worried about how its war in Ukraine is perceived.
FOR BUSINESS. Putin won’t be in danger from the riots, but his apparatchiks will. Russia is mostly winning in Ukraine – if this can be defined as avoiding the loss of more captured land – but at the price of tens of thousands of men, mostly from the regions. Beyond the cost of sanctions, this has led to a tight labour market and high inflation. Russia's central bank chief was hospitalised on Tuesday. The West has hinted at seizing $300 billion in central bank assets.
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THE BALKANS. Secession planning
Serbs seek a new deal, at home and abroad.
Kosovo Serbs began a petition to oust ethnic Albanian mayors on Wednesday. Thousands marched in Belgrade against the government’s re-election. The president of Bosnia's Serb Republic had his criminal trial adjourned for a third time.
INTELLIGENCE. Snap polls in December and months of escalating tensions with Kosovo and Bosnia have placed Serbia on a knife edge. While the re-elected government remains notionally committed to EU membership and neighbourhood rapprochement, its actions in Belgrade and beyond – not to mention credible allegations of electoral fraud – suggest bad faith. Russia (and possibly Hungary) are thought to be behind some of Serbia’s recent moves.
FOR BUSINESS. Attributing political blame in the former Yugoslavia is a fool’s errand, but it still paints a picture of sovereign risk. Western investors are meanwhile watching the fate of Rio Tinto's Jadar lithium mine in Serbia's west. Belgrade revoked Jadar’s licence in 2022 following mass protests. The $2.4 billion project, which could supply 90% of Europe’s lithium, could be a test for an economy that otherwise managed to grow at 3.5% annually in Q3.
FRANCE. GERMANY. The centre scolds
Paris and Berlin attempt to halt the far-right.
Emmanuel Macron said the opposition National Rally was the party of "easy anger" during a lengthy press conference on Tuesday. Olaf Scholz praised protests held in various cities on Wednesday against the Alternative for Germany party.
INTELLIGENCE. With falling approval ratings, fracturing legislative support, and the spectre of a crushing European Parliament defeat in June, the leaders of France and Germany have promised technocratic fixes for mounting populist wrath. Yet with one hand tied by Brussels, and the other by the European Central Bank, there’s little they can do but complain. Much of the anger, moreover, is tied to their personal brand and those of their big tent governments.
FOR BUSINESS. For the centre to hold, either bold reforms or charismatic leadership are needed. Paris has tried the latter with last week’s appointment of 34-year-old premier Gabriel Attal, but the so-called mini-Macron will unlikely appeal to regional France. In Germany, there are shades of Hilary Clinton’s “deplorables” moment in Scholz’s rhetoric about far-right voters – many of whom would have previously supported the centre and even the centre-left.
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UNITED STATES. MIDDLE EAST. Sanctions and sanctimony
Washington redesignates the Houthis while talking to Hezbollah.
The US placed Yemen's Hothis back on its list of terrorist groups Wednesday as the militia hit a second US vessel in almost as many days. Lebanon's Hezbollah rejected a US diplomatic proposal Thursday but said it was open to ideas.
INTELLIGENCE. Diplomacy demands you speak to people you hate, but many in a polarised US will view the outreach to Hezbollah with distaste, not just because of Israel but because the group was linked, in 1983, for the deadliest attack on US forces since Vietnam. No such talks are being entertained for the Houthis, at least publicly, despite Saudi and UN efforts. Qatar has meanwhile brokered an aid-for-medicine deal between Israel and Hamas.
FOR BUSINESS. Israel and the West are in a relatively strong position to set terms with Hezbollah and Hamas, but in Yemen, the Houthis are willing to escalate – and with less regard to their erstwhile handlers in Tehran. Coupled with events on the other side the Gulf of Aden, the Red Sea could thus remain a no-go zone even if a deal is reached in Gaza. Elsewhere, Iraq continues to claim it no longer needs US forces, despite this week’s strikes by Turkey and Iran.
ETHIOPIA. SOMALIA. Mistakes on a plane
A dispute over sovereignty escalates.
Somalia turned back an Ethiopian flight to Somaliland on Wednesday. Ethiopia said Tuesday it had acquired ten Su-30 combat jets, plus Turkish UAVs. The son of Somalia's president was fined $910 for killing a Turkish courier in November.
INTELLIGENCE. Since Addis Ababa announced a port access deal with breakaway Somaliland on 1 January, relations with Mogadishu have soured. Ankara, which has strong ties with both sides, has been caught in the middle (a factor worsened by the Somali president’s lead-footed son). The US, Arab League, and African Union (based in Addis) have expressed concern in recent days. A food crisis and militant strikes in both countries are also exacerbating tensions.
FOR BUSINESS. The turnback of an Ethiopian Airlines flight is unusual, especially as Somalia has no real air force, but the carrier – whose partial ownership is coincidentally being offered as a sweetener to Somaliland – will not have wanted to take chances. Ethiopian is Africa's largest airline. And having survived a Boeing 737 MAX 8 disaster in 2019, plus controversies over its role in the Tigray War, it also has a reputation to uphold as the region’s best.